Collaborative Divorce vs Informal Settlement

How Does Collaborative Divorce Compare with an Informal Settlement Process?

Many people ask me what the difference is between collaborative divorce and an informal settlement process. When is one preferable to the other? And how do they differ?

Informal Settlement Process

1. Is unstructured. The parties and their attorneys usually exchange information by agreement, including sworn inventories, and then schedule the case for mediation. Often if the case is relatively uncontested, and if there are no children involved, this can be an efficient and less expensive process than collaborative. The problems arise when it becomes evident that the case may actually be higher conflict. While the parties may still desire to stay out of court and work toward that end, the process is open-ended and not structured. If settlement negotiations become difficult, nothing is preventing the parties from threatening litigation or one or both of them going straight to the litigation process.
2. Makes use of mediation instead of collaboration in joint sessions. Most family law mediations will last anywhere from a half day to a full day or longer. During that time, the mediator and attorneys will be on the clock. In mediation, the parties can become polarized without the skills of a good mediator to give everyone a reality check. Mediation works best when the lawyers and their clients are realistic about the value of their case and what they are willing to agree to in order to avoid litigation and its attendant emotional and financial expense. Mediation is usually a very successful process, but most family law mediators keep the parties apart the entire time, so the lawyers and clients may never meet the opposing side. Sometimes with very high conflict cases, this is a good thing, but in lower conflict cases, joint meetings – at least to hear the mediator explain how it works – can help humanize the process.
3. While a mediated settlement agreement or an informal settlement agreement are both binding, if properly drafted, an informal settlement agreement also requires a finding a property division is just and right.
4. There is no requirement the lawyers withdraw if the case fails to settle and must proceed to trial. There is no requirement experts be jointly hired, though they often are. Inventories are prepared by the attorneys and paralegals at their prevailing rates.

Collaborative Process

1. Is structured and business like. Each party must be represented by an attorney, preferably one trained in the collaborative process. Collaborative usually employs the “team” approach, consisting of the parties, their lawyers, and a financial neutral and a “process facilitator”, who is a mental health professional. The team meets in joint sessions usually limited to two hours for the full team. The parties and the neutrals sign a participation agreement containing the following provisions:
   • The parties will work toward settlement and not threaten litigation
   • Experts will be jointly hired and paid
   • The parties will be transparent and ensure full disclosure of assets
   • If the case is unable to settle, the attorneys must withdraw and litigation attorneys substituted
   • No one can have hired a “secret” litigation lawyer waiting in the wings
   • The financial neutral prepares the inventory and budgets
   • The mental health professional, though not serving as anyone’s therapist, can work with the parties on a parenting plan and meet with the children, if the parties agree
   • The parties agree to follow a code of conduct
2. The collaborative process follows a specific roadmap. Each meeting has a definite purpose, and the parties must cooperate to provide information. Once everyone is in possession of the information needed to fully resolve the case, we start exploring options for settlement. The goal is to settle the case by generating options for settlement, rather than using positional bargaining.
3. A collaborative law settlement agreement is fully binding, if properly drafted, in the same way as a mediated settlement agreement. In high conflict collaborative cases, the use of a mediator is always an option if the case is in need of a less face to face process. However, most collaborative cases settle without the use of a mediator using the joint session approach.
4. If necessary, the parties and attorneys can schedule a signing session once the case is settled, to go over documents and make sure everything to finalize the case has been signed. As with the informal settlement process, a brief court appearance to “prove-up” the divorce is necessary; the judge will sign the decree at that time, unless the prove up was done earlier on the basis of the settlement agreement. Both parties need not be at the prove up.